The ministry, controlled by Merkel’s conservatives and their veteran lawmaker Wolfgang Schaeuble, said in its monthly report the economy lost some momentum at the beginning of the third quarter.

“But recent economic data indicate that the solid upswing will continue also in the third quarter,” the ministry said, adding business morale remained high and German exporters were expected to benefit from a global economic recovery.

The German economy grew 0.7 per cent in the first three months of the year and 0.6 per cent from April to June, driven by increased household and state spending as well as higher investments in buildings and machinery.

Economic data in the past weeks had painted a mixed picture of the economy, with unemployment continuing to fall and the mood among German investors improving.